COPY.
10/1972.
(F.1.)
Sir,
8th June, 1914.
36
With reference to Treasury letter 19691, dated 4th October, 1913, regarding the assessment to Military contribution of the net revenue derived from Opium by the Colony of Hong Kong, I am commanded by the Army Council to acquaint you for their Lordships' information that a letter on the subject has been received from the Colonial Office (No.44538 of 14th January, 1914), containing more detailed
73 information in regard to the proposal. It is understood
that a similar letter with copies of the enclosures has been
sent to the Treasury.
The establishment of the monopoly of the
manufacture of opium appears to have necessitated the
adoption by the Hong Kong Government of measures similar to
those instituted in the Straits Settlements, i.e. the
establishment of a Government Opium Factory and the creation
of a Preventive Service.
As regards the factory the Army Council are willing
to agree, as in the case of the Straits Settlements, to the
deduction from groas receipts of the working expenses
and maintenance charges, including interest on Capital
expenditure.
These deductions would include not only the items
referred to as "cost of manufacture" in Mr Severn's dispatch
The Secretary,
The Treasury.
to